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			Business Research: Sales Vendor Research: Business Objects, Callidus, CellarStone, Centive, Cognos, ForceLogix, Oracle, RightNow, SAP, Strategix, Synygy, Varicent, Xactly
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Summary
Top-line revenue growth depends on an effective sales organization, but ensuring that the sales team is motivated requires that they know management is handling their sales compensation accurately and efficiently. Xactly, a provider of on-demand sales compensation management, has improved this process, from design, management and issuance of sales plans and commissions through payment. With organizations continuing to look for ways in which streamlining processes can improve accuracy and positively impact performance, sales compensation management is an increasingly obvious choice. Ventana Research recommends that organizations examine how Xactly can help them improve the sales compensation process so operational performance hits its targets.

Assessment
Today most organizations design their sales compensation plans in spreadsheets and other documents and manually enter them into sales force automation (SFA) systems. After that, they transfer information about deals closed, again manually, from the SFA application to the booking and order processing systems and ultimately to the accounting system. Moving this data through these disparate systems has impacted the timeliness and accuracy of the sales compensation process, often with the negative effect of demotivating the sales organization.

Xactly Corporation came to the sales compensation management software market more than a year ago, determined to make this process easier. With this research note, we are establishing coverage of Xactly in our sales performance management research, which aims to educate finance, HR and operations management on the importance of improving sales compensation management. Xactly provides an on-demand, Web-based application called Incent, which it hosts and manages to assure integrity and security. It sells the service by subscription. Xactly partners with salesforce.com, filling its sales compensation management void and integrating into its application suite.

Xactly Incent takes a rules-based approach to designing the sales compensation plan. Central to this approach is structured management of the plan documents and associated workflow throughout the creation, revision and approval steps of the process. The application’s user interface was designed to accommodate the variety of roles that interact with sales compensation: executives, sales operations and finance managers, compensation analysts and sales representatives themselves. Reps can create what-if scenarios, reports on their progress in relation to the plan and forecasts of their potential payments.

From the perspective of finance and sales management, documentable integrity of any such system is critical. Xactly Incent supports multiple tenants in a software as a service (SaaS) model that complies fully with SAS 70 Type II security requirements. In October, Xactly introduced two complementary capabilities in analytics and data management. The Xactly Analytics module provides in-depth analysis and reporting of sales compensation for sophisticated organizations whose compensation analysts demand more than simple reports or plan-design analysis. Xactly Data Management expands beyond salesforce.com integration to streamline throughput of data with JD Edwards, Microsoft, Oracle, PeopleSoft, Siebel and other enterprise resource planning (ERP), customer relationship management (CRM) and human resources management system (HRMS) technologies, as well as payroll processors such as ADP and Ceridian.

Market Impact
Xactly has moved rapidly in the sales compensation management market, providing a simple path to rationalizing that set of processes and supporting them alongside existing ERP, CRM and HR systems. This is a large market, ranging from organizations that operate with a couple of dozen sales people to those that have thousands; key competitors are other salesforce.com partners such as CellarStone and Centive and a broader market that includes Callidus, Synygy and Varicent. CRM and ERP providers such as Infor, Microsoft, Oracle and SAP have not moved rapidly to address this key requirement. Of course, the use of spreadsheets for this process remains the largest sector against which these applications compete, and we hope to see these providers help customers wean their users from spreadsheets in favor of an automated process.

Recommendation
For organizations that realize they need to improve the accuracy and quality of the process to empower their sales organizations and hit their sales targets, rationalizing and standardizing sales compensation should be a key objective. Xactly’s on-demand approach provides both sales reps and management immediate access to performance information while analyzing results to support improvement. Ventana Research recommends that organizations examine their existing sales compensation process and if need be replace spreadsheets or old systems that are not helping them improve sales performance.